Republican Congressman suggested the reason for the stagnation of the US crypto market, 2026/01/02 15:16:14

Republican member of the US House of Representatives from Ohio Warren Davidson explained why the crypto market has slowed its growth and explained what the future fate of digital currencies depends on.

Davidson published a post on the social network X, saying that the pressure on the crypto market is coming from a change in government policy – when legislators and regulatory agencies are pushing crypto businessmen to work in a system with stricter controls and less freedom. If transactions with digital assets become similar to traditional financial transactions, cryptocurrencies lose any advantages over banks – although cryptocurrencies initially involve the elimination of intermediaries, Davidson explained his idea.

The problem is aggravated by legal uncertainty and slow changes in legislation, the congressman said. Regulatory pressure is hampering innovation—Davidson mentioned the crackdown on open source software developers, cryptomixers, and other privacy-enhancing tools.

The law regulating the issuance and circulation of stablecoins, which came into force in the summer of 2025, favors banks by prohibiting non-bank organizations from paying interest on stablecoins, the parliamentarian announced. According to the congressman, all this weakens competition between banks and token issuers, limiting people’s choice of financial instruments.

The Republican insists: The law does not provide protection for investors if they hold their crypto assets themselves—instead, the law lays the groundwork for the launch of a wholesale central bank digital currency, even if the term “central bank digital currency” is not directly mentioned in the law. Davidson argues that the features of central bank digital currencies, including tracking and controlled access, are being developed behind the scenes. At the same time, the congressman admitted, stablecoins can increase demand for Treasury bonds and optimize the cost of paying off the national debt.

According to Davidson, the fate of the crypto market now depends on the Digital Asset Market Transparency (CLARITY) bill, which passed the House of Representatives but stalled in the Senate. Congressman believes that this bill will clarify the rules for tokenized goods, securities and real assets, and also eliminate gaps in the law regulating stablecoins.

In November, Davidson introduced the Bitcoin For America Act, which proposes allowing Americans to pay taxes with bitcoins so that these funds go to the US government’s bitcoin reserve.